Billboard's YouTube decision just made Vevo a lot more important

Today Billboard Magazine announced that it has updated its formula for ranking the Billboard Hot 100, the iconic list of the week’s most popular songs, to include YouTube plays in its formula.

It’s a clear-eyed move for the venerable magazine and 55-year-old chart – a rare instance of the traditional music industry acknowledging the importance of the Internet, at which it has historically thumbed its nose.

To Billboard’s credit, the list already takes into account Spotify streams. And the push to include YouTube data – which had been in the works for almost two years, the New York Times says – was catalyzed last week by the newest viral sensation, Baauer’s “Harlem Shake” (and those God-awful imitation videos). Surely, “Gangnam Style” and “Call Me Maybe” played pivotal roles too. YouTube also has a little something to do with the career of that Justin Bieber kid.

If you believe placement on the Hot 100 list still matters, and I’ll wager it does to many music industry folk, then the decision to include YouTube views as factors for ranking the list has some clear implications.

Billboard editorial director Bill Werde says digital data, which includes the Spotify and YouTube data, would account for 20-35 percent of how it ranks songs' performance on a typical week. So traditional metrics like sales and airplay still take the lion’s share when deciding ranking. (Perusing Billboard’s leadership page led to another revelation: Did you know Tommy Page is the publisher of Billboard Magazine? Yes, thisTommyPage.)

Let’s go ahead and state the obvious: Factoring in YouTube views suddenly means that the stock just rose on those clicks. That means the marketing departments at the record labels will likely, at least in some capacity, focus more attention and money on getting you to up their artists’ view counts.

This give a company like Vevo, which works closely with YouTube, more power. Vevo is a standalone music video site that also has a monopoly-like lock on major label music content on YouTube. Any query for a top 40 hit likely directs you first to a channel powered by Vevo. According to its website, it was ranked by comScore as the number one music platform on the Web. Billboard mentions it by name as a tracking source, and it is already in Billboard’s good graces; the magazine named it the number 2 best digital music startup of 2010. (It was bested by Rdio, whose streaming data Billboard also takes into account.)

But should Vevo get more power? It could put some artists at an advantage over others. Vevo is a joint venture between Sony Music Entertainment and Universal Music Group (and Abu Dhabi media, though that’s not as relevant when tracking U.S. charts), which could presents possible conflict of interest. For example, a more egregious offense would be skewing the way it reports its numbers to Nielsen to favor its artists. Werde says YouTube has de-spamming technologies and that Billboard pays close attention to data irregularities to spot any shenanigans, but still concedes, “I suppose anything is possible,” he tells PandoDaily. Jennifer L. Press, Vevo’s senior director of marketing and publicity, insists Vevo operates independently. That seems reasonable, but it’s important that Vevo clearly makes known its ownership situation.

Warner Music Group will also be missing out a bit. It’s the only label of the big four “majors” not to host content on Vevo, so it is left out of the company’s ecosystem altogether. Instead, Warner linked up with MTV Networks. That’s not a shabby situation either; a fan can watch a video on YouTube from a non-Vevo channel and it obviously still counts as a video view for the artist. But while the majority of Vevo views come from YouTube, Billboard will also soon be tracking the remaining views that come directly through Vevo’s platforms. Werde says the companies are in “nicely progressing discussions” about that.

Incorporating YouTube views into Billboard’s process is absolutely a step in the right direction. But there are clearly wrinkles the publication will have to iron out over time. For example, Werde mentions on Twitter that the list will have to find a way to distinguish between legitimate hits and viral YouTube “anti-hits” a la Rebecca Black.

Either way, it does put a new emphasis on the music video, which had become outdated on television networks. (When’s the last time MTV played a video during hours when most people are actually awake?) Billboard’s bright digital move could revive what has become, at least for in this decade, a somewhat retro form of art.